Geojit Sec, Abn Amro Jv Talks Fail

Joint venture talks between ABN Amro Bank and Geojit Securities Ltd have fallen through.

Geojit Securities, a leading depository participant, was in talks with ABN Amro to offload a part of its stake to the Dutch bank.

Disagreements between the two on the structure of the alliance led to the talks falling through, sources said.

"The joint venture talks are off," said a senior Geojit Securities official, but declined to speak any further on the issue.

Geojit Securities is now planning to strike alliances with banks to provide an interface with them, which is being seen as a necessity for the success of Internet trading.

 

Geojit can today strike deals for clients and also ensure that the shares are transferred from one account to another through the Net, but without a banking interface it cannot ensure a transfer of funds through the Internet.

This was the reason behind it seeking an alliance. On the other hand, ABN Amro does not have any significant presence in the depository business and would like to provide the depository interface to its clients. It has its own broking subsidiary. Geojit Securities was the first brokerage in the country to offer Internet trading to its clients. Most of the broking outfits venturing into Internet-based broking facilities are in the process of tying up with a bank and a depository participant to offer a seamless platform for carrying out trading via the Internet.

It is convenient for the customers who want to trade via Net as well as the brokerages to have such banking and DP interface to check balances in the clients' account. It is also necessary to debit and credit the customers demat account and bank account, respectively, whenever they buy or sell securities through a given broker. Many of the banks who were depository participants have also ventured into e-broking to offer all the three services to their existing customers.